HSBC is planning to significantly cut down its IT workforce in the UK by transferring jobs to lower-cost countries as part of the bank's global delivery network strategy.
The company will cut 840 non-customer-facing IT jobs in the UK to help reduce its operating costs. The jobs which will be cut are currently located in London, Tankersley and Sheffield. By April 2017, these jobs will be moved to China, India and Poland.
HSBC explained the reasoning behind these job cuts and relocations: “The relocation of these roles is part of HSBC's large and ongoing IT investment to build a global world-class IT Infrastructure. In addition, as publicly stated many times, we've targeted significant cost reductions.”
While 840 IT jobs will be lost in the UK, the company's CEO John Hackett expressed how the UK will remain a critical part of HSBC's future: “The UK will continue to play an import role in HSBC's global IT infrastructure, employing several thousand IT professionals.”
In 2015, the bank announced a new cost-cutting strategy that would entail 8,000 jobs being cut by the end of 2017. The job cuts announced today fall in line as part of HSBC's bigger strategy to cut costs worldwide.
Recently a number of companies have employed similar strategies and have taken advantage of global delivery networks to lower their operating costs. By employing workers from low-cost countries, HSBC will be able to lower the amount of money it currently spends on its workforce.
However not everyone agrees with the bank's latest move to cut costs. Dominic Hook, a national officer for finance at union Unite, sees the decision to cut so many IT jobs in the UK as one that is as “ruthless as it is reckless.” He was also able to give more details on how this decision has already affected IT workers in the UK:
“For almost a year staff have been left in the dark about their futures, only to be told that before being shown the door they're expected to train someone in India or China who will do their job for less money. It is a deeply cynical move.
"Offshoring IT jobs to so-called low-cost economies is extremely short sighted. As IT glitches across the banks continue to prove, it is ultimately the customers who will suffer the consequences.”
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